Annual Report 2008-2009

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OUTPUT 4.2: Contract management

Output 4.2

On this page: Overview :: Construction projects :: Contract with United Group Services (UGS) :: Outlook

The department will ensure the efficient and effective contract management of the overseas owned estate.

Key Performance Indicators 2008–09 Target
  • Effective management of the United Group Limited contract for the provision of outsourced property services to the overseas estate
  • Implement successfully the new contract with United Group Limited and establish an agreed operational model
  • Efficient and effective management of construction project contracts in the overseas estate
  • Manage construction project contracts effectively to meet performance and cost targets
  • Overview

    The department’s Overseas Property Office (OPO) made use of a wide range of specialist contracted services in managing the overseas property estate, including project design, management and construction, property purchase and disposal, audit and legal. Service providers were selected in accordance with government tendering and contracting procedures. We successfully managed our new four-year contract with United Group Limited for the provision of property services.

    The department’s management of our substantial construction program was efficient and effective. A key achievement in 2008–09 was the successful completion of key construction projects in the overseas estate, in particular the opening of the new chancery in Cambodia.

    Management of construction projects

    Photo - See caption below for description
    Executive Director, Overseas Property Office, Mr Peter Davin (right), with Director of Denton Corker Marshall, Mr John Denton, at the signing of the contract for the design of the new Australian Embassy complex in Jakarta, on 29 May 2009.
    Enlarge image :: Photo gallery

    We managed a varied construction program in the overseas owned estate throughout 2008–09. New chanceries were completed in Amman and Phnom Penh, as were refurbishment works on the High Commission in Kuala Lumpur. Works continued on the construction of staff apartments at our embassy in Baghdad. Preparatory work began on refurbishment of staff apartments in Tokyo.

    Acquisition of land for construction of a new chancery and staff apartments in Jakarta was completed. We signed a contract for the design of the Jakarta chancery with international architects Denton Corker Marshall in May 2009. This major project was referred by Parliament to the Joint Standing Committee on Public Works for consideration in June 2009. Land purchase in central Jakarta for this purpose was completed in 2009.

    In addition to projects in the owned estate, OPO completed work on new leased chancery offices in Belgrade, Madrid and Tel Aviv, and work commenced on leased office relocation and fit-out in Abu Dhabi, Nicosia, Seoul and Stockholm.

    Number of project contracts managed

    OPO completed eight projects in the overseas owned and leased estate, and had oversight of five projects under construction in the owned and leased estate. OPO managed preliminary and design works for 15 properties approved for relocation or refurbishment. In accordance with its obligation to maintain the long-term value and condition of the overseas estate, and to meet security and other requirements, OPO undertook feasibility studies for possible or prospective future works in a number of other locations.

    New chancery opens in Phnom Penh

    Photo - See caption below for description
    A view of the new Australian Embassy in Phnom Penh completed in May 2009.
    Enlarge image :: Photo gallery

    Phnom Penh embassy staff moved into new office accommodation on 29 June, with the completion of construction and fit-out of the new chancery. This project was one of the most significant construction works delivered by the Overseas Property Office in 2008–09.

    Australian firm Bligh Voller Nield were the architects with the main construction completed by Leighton Contractors Asia. Works were completed in May 2009 with an impressive safety record of over 1.3 million man-hours logged without accident.

    The new building houses Australia-based staff of the Department of Foreign Affairs and Trade, the Australian Agency for International Development, the Department of Immigration and Citizenship, the Department of Defence and the Australian Federal Police.

    The new three-storey chancery provides a functional and efficient work space and is built to appropriate security and environmental standards so that it provides a pleasant and secure environment for staff and visitors. It is conveniently located next door to the Cambodian National Assembly and to the Ministry of Foreign Affairs and International Cooperation.

    Visitors to the chancery will notice immediately the large sacred bodhi tree at the front entrance. The bodhi tree has particular religious significance to all Buddhists, including Cambodians, and is generally only planted in public buildings or temples. This mature tree was on the original block of land purchased for the chancery. Because of its significance, considerable efforts were made to protect the tree during construction and it now forms the centrepiece of the garden, which combines local tropical plants with design elements of wood and stone.

    Outsourced property services contract

    We began a new four-year contract with United Group Services Pty Ltd (UGL) in July 2008 and established agreed operational arrangements for the provision of an expanded range of property, facilities management and finance services in the overseas property estate. This included expansion of the on-site facilities management network with additional positions in South America, Africa and the Middle East.

    Under the contract UGL provides services to the owned estate like repairs and preventive maintenance of plant, equipment and buildings. Services provided for leased chanceries and leased head of mission and head of post residences include, for example, annual property inspections and technical advice on essential services, building safety and compliance.

    UGL maintains a 24-hour helpdesk service to receive and respond to problems reported by staff overseas. A total of 5870 calls were made to the UGL call centre, with 93 per cent of calls responded to within indicated response times for successful service delivery.

    Contractual outcomes

    OPO successfully managed the implementation of the new contract with UGL through a program of mobilisation briefings at regional posts attended by posts’ senior administrative officers and locally engaged property managers, and through constructive engagement with UGL in Canberra.

    The department ensured that the service provider maintained close liaison and effective working relations with tenants and that property management services were delivered to agreed standards.

    The performance of UGL is measured against contractual indicators relating to financial and business processes, tenant satisfaction, portfolio condition, divestments and capital works. Overall, the contract delivered good outcomes.

    Each year OPO measures tenant satisfaction with the delivery of property management services by UGL and this measure for 2008–09 was satisfactory.


    In 2009–10 we will continue to manage substantial commercial contracts to deliver a wide range of project and property management services in the overseas property estate.


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